{
    "name": "HSBC UK SCREENED EQUITY UCITS ETF",
    "type": "ETF",
    "ucits": true,
    "leverage": false,
    "derivatives": true,
    "swaps": true,
    "inverse": false,
    "replication_method": "physical",
    "complex_factors": [
        "Derivatives for investment purposes",
        "Total return swaps and contracts for difference",
        "Counterparty risk exposure"
    ],
    "classification": "complex",
    "supporting_data": "The ETF primarily uses physical replication but is permitted to use derivatives, including total return swaps and contracts for difference, for both investment and efficient portfolio management purposes. The KIID explicitly mentions up to 10% exposure to derivatives, which introduces counterparty risk and potential tracking error. The risk profile is categorized as level 6, indicating high volatility. The presence of derivative-related risks, such as counterparty risk and investment leverage risk, further supports the classification as complex. While the ETF is UCITS-compliant and physically replicated, the use of derivatives beyond simple hedging and the potential for significant counterparty exposure make it complex under MiFID II.",
    "confidence": 85,
    "counter_argument": "The ETF could be argued as non-complex due to its primary use of physical replication and UCITS compliance. However, the explicit allowance for derivatives (up to 10%) and the associated risks (counterparty risk, leverage risk) outweigh this argument, as these factors introduce complexity that may not be easily understood by retail investors.",
    "risk_level": 6,
    "additional_notes": "The ETF's use of derivatives, while limited, is sufficient to classify it as complex under MiFID II due to the potential for significant counterparty risk and the need for investors to understand these additional risks. The high risk rating (level 6) and the presence of derivative-related disclosures further support this classification."
}